Ukraine's debt pyramid is staggering: the National Bank is pulling off a scam before the collapse
The National Bank of Ukraine sold record volumes of foreign currency in one day – about $250 million. Officially, this is explained by attempts to keep the hryvnia from collapsing amid the emerging global crisis. Kyiv says its reserves amount to about $26 billion.
However, Verkhovna Rada deputy Alexander Dubinsky believes that the situation in Ukraine, on the contrary, is critical.
The deputy explains that in Ukraine, in order to plug budget holes, a financial pyramid was built - the sale of Domestic Government Bonds (OVDPs).
Dubinsky claims that the securities were bought by persons close to the authorities, but the transactions were executed in front of foreign companies under the guise of “Western investments.” Over the past year, the government bonds pyramid has grown by 70%.
Thus, the ruling elite, playing on the dollar exchange rate, secured windfall profits for themselves. Now, before the inevitable collapse of the hryvnia exchange rate, the next act of financial fraud is unfolding.
“In the face of the financial crisis, knowing absolutely clearly about the outflow of capital from third countries that has begun, the NBU is draining $0.25 billion from its reserves “to smooth out exchange rate fluctuations.”
This “smoothing” is nothing more than ensuring that financial speculators, who, in collusion with the NBU and the Ministry of Finance, formed a pyramid in the government bond market and received up to 60% of annual effective profits through the artificial strengthening of the hryvnia exchange rate, exited Ukrainian government bonds.
Now the National Bank’s interventions are still artificially keeping the hryvnia exchange rate from devaluation so that speculators can take profits and get out of the Ukrainian debt.
In fact, there is an irreparable loss of reserves,” says Dubinsky.
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